Wednesday, December 28, 2016

' just read a really good article in the Chronicle about how the current tax structure is hindering home sales in the Bay Area (San Francisco), and bringing prices up.

When you sell a property that has been a principal residence for many years, you usually have a large capital gain, and the tax that comes with it. In a very common scenario, there is a capital gains tax exemption of $500k if you are a married couple, or $250k if you are single. The problem arises when you have bought your home a very, very long time ago: the purchase price is so low that when compared to the sales price today, and after factoring in the costs and capital improvements ( - thanks to CPA's for helping with all these calculations 😊 ), the capital gain is so high that the tax due on it is a big deal.

Some would say that this is a good problem to have. But in fact, many people do not want to have such a tax hit, or some people just cannot pay the tax (i.e. if you have borrowed a lot on your equity, you don't have much left when you sell).
This situation is so acute in the Bay Area (think: large appreciation) that it has contributed to the lack of inventory we've seen in the past few years, and this in turn is pushing prices up.

While there are several options to try to deal with the problem, none of them is so easy or straightforward - except for dying, which I will pass on - no pun intended... So homeowners who find themselves in that situation often just delay the sale until later, and later... and there are fewer homes on the market.

The article was written by Kathleen Pender, Business Columnist at the SF Chronicle.
Check here to see the article and the interactive map showing where the capital gains are most prevalent, in the 9 Counties that make our "Bay Area".

Monday, October 31, 2016

In the process of helping clients to rent their income property, I had noticed since last March/April that prices were not as strong a before, and recently had even been going down a bit. But this is difficult to verify, since there are so few rentals locally in a given month.
I am glad to see some confirmation of that in this article from the Mercury News that I just read last Tuesday (10/25/16), in which Richard Scheinin pools several sources showing that rents have stopped going up in several cities around the Bay, and even come down a bit since last year.

It is interesting to note the Axiometrics study which found that rents in San Jose fell 3.4% since last year, San Francisco rents fell about 3.3% too, while nationwide rents overall continued a slight up curve.
Thank you for reading! - and if you like my blog, share it ;-)
Francis

Saturday, October 22, 2016

– It has been a relatively
quiet two weeks, according to our Cupertino manager. Open house traffic is
steady.

Our Los Altos manager sees continued signs of seasonal adjustments
although inventory is low as summer comes to a close and we move into fall.
New inventory has slowed of late. This lack of inventory has had a
direct impact on those homes which had been "lingering" on the market
and agents have seen additional price reductions on homes with higher than
average DOMs (days on market). Sellers are still wishing to “test the market” by bringing
their homes on at higher prices than previous sales and pendings.
However, this pricing strategy has proved to be risky, given that many
buyers' expectations are that they will still need to offer over the
asking. As a result of this type of pricing strategy agents are seeing a
“self-fulfilling prophecy” with these homes having little to no activity. These
homes end up stagnant and linger on the market, eventually having to lower
their price to generate activity. To the contrary, there has been strong
activity with properties in move in condition and priced to sell. These
homes are still receiving multiple offers that typically achieve a sales
price that is over asking. This was the case with one of our recent
listings, which had 24 offers. In short, we have experienced a slowdown of
homes coming on the market over the recent weeks. And those that are
coming on, when priced to induce offers, are being absorbed quickly.

The Los
Gatos market under $2.5 million continues to be extremely competitive.
The market over $2.5 million is a tad slower but great properties over $2.5
continue to sell.

The San Jose Almaden market had an average number of sales
for the month with 40, which is down from 44 in August and flat with the 39
sold in 2015. Prices were up with the median sales price at $1,320,000
for the month, up 7.8% from the previous month and 3.5% higher than the
previous year. Blossom Valley had a strong month in units sold with 94
closings, up from 88 last month and 86 last year. The median home price
of $751,250, up 4% from last month and last year at this time.

Cambrian
had a big jump from last month with 86 closings, 20 more than August and 4 more
than 2015. The median sales price was $937,500, up 3.9% from last month
but down 1% from September of 2015.

Santa Teresa had a lower number of
units sold at 27, down 6 from last month and down 13 units from September of
2015. The median sales price of $750,000, down 4.5% from last month but
up a whopping 11% from September of last year.

Willow Glen got a surge of new listing
inventory this past week, going from the low 60’s count to 83 active listings.
Agents are reporting slower traffic at open houses, particularly if the
property has been on the market more than 2 weeks. However, some properties are
still selling quickly with multiple offers, but typically the offers are at or
just slightly above the list price.

Wednesday, October 19, 2016

It seems apropos in this pre-election period to look at
some of the differences between blue and red states, with regards to
housing. Here we go:

The median household
income in blue states is $62,564, about 23% higher than in red states,
where it is $50,820. In those blue
states, 1.4% of households bring home $500k or more (think: tech

fortunes in
California’s Silicon Valley, and seven-figure bonuses on New york’s Wall
street). These 1.4% seem small, but it
is 133% more than the percentage of households that bring in $500k or more in
right-leaning states.

The median price
of homes is $301k in blue states, which is 91%
more than in red states.

Ohio has the least expensive homes (although it is a swing
state).

Homeownership is
highest in red states, where it costs less to have a home. However, (- exception), the city with the
highest homeownership rate is San Jose (CA) even though the median list price
of homes is $767k, according to Realtor.com.
Washington DC has the lowest homeownership rate. In red states, people spend 26% of their
median household income to buy a place, while it takes 32% of a household’s
income to buy a place in a blue state.

Renting takes an
average of $1,381 a month in blue states.
This is 52% more than in red states where it costs an average of $904 per
month. “The cost of housing is directly
tied to how much land is available”, Realtor.com’s Chief Economist Jonathan
Smoke says. “The parts of the country
that have an abundance of land have the lowest housing costs”.

Click on Pix to see larger

The median size
of houses in red states is about 2,000 sq.ft.
– about 210 square feet larger than in blue states.

Oldest houses: in
blue states. Many of the blue state cities are older than their red
counterparts.

Mobile homes: the
highest concentration of mobile and manufactured homes are based in the red state
of Mississippi. The city with the lowest
percentage of these homes is San Francisco.

Solar panels: liberal states tend to have more eco-friendly
residents, who are 12% more likely to

have solar panels installed on the roof
of their homes. The most panels (in
number) were installed in California, while Hawaii has the highest percentage
of residences with the solar power source.
San Jose (CA) is the city with the highest percentage of homes with
solar panels. The fewest panels are in
the (red) state of Wyoming. Memphis, Tennessee, was the city with the smallest
percentage of residents invested in them.
Thank you for reading!

Thursday, September 29, 2016

This is the typical conundrum that we face in our market:
there are fewer homes on the market because, while it can be “easy” to sell
your place in this market, it is not so easy to buy your replacement property. This is why many people have postponed their real estate plans.

There are a few ways around this, all requiring to be well prepared:

-Arrange for temporary housing, with the help of your
friends or family: a short-term solution sometimes can be found if you turn to
relatives or friends who may have a second home, a vacant rental unit, or even
room in their house. This is not ideal but could enable you to sell your
house first, and have less pressure to find the replacement home.

-Place a contingent offer: “subject to the sale of your
property within ..xx days”. This refers to a condition in your offer to
purchase, with the condition that you will be “in contract” on the house that
you have to sell within so many days. There is quite a bit of preparation
to be able to achieve that: you need to be ready to go, on the starting blocks,
for the sale of your house - before you place an offer on another house.
That means all inspections done, all repairs done (if any), and the whole marketing
file ready to go. Usually, once your offer has been accepted, and if it
is well negotiated, you have a few days before the other party can cancel on
you, so that you do not find yourself having sold your home, and with no place
to go.

-Sell first, and arrange for a rent-back. This
means that you take an offer subject to you being able to stay in your home for
a given time, renting it from your buyers, to enable you to find a replacement
home and buy it. If your buyers are buying with a new loan, the
rent-back will most likely be limited to a maximum of 2 months.
If they buy all cash, then this limit disappears. This gives you an
additional chance that you will not have to move twice.

-Arrange for a “bridge loan”. This solution, in
the most recent version, will let you borrow up to 70% of the value of both
homes at a high interest rate for a few months, as long as you qualify for the
final (purchase) loan. The goal will be to purchase, then sell as soon as
possible, and refinance the bridge loan into a "normal" loan.
An alternative is to get a line of credit on the 1st house and use the
cash for a larger down payment on the second house, but in that case your
lender will need to see you qualify for both loans + the line of credit.
You avoid that with that new "bridge loan". It can be
expensive, but if it is only for 2 to 3 months and it does enable you to move,
it can be worth it. Call me for further information.

Unfortunately, there is still currently no real bridge loan,
as they existed a decade ago (see my previous blog from 2013: "But, where did the old bridge loans go??"). But it is nonetheless possible, with good
preparation, to “sell and buy”. It is made a little easier lately by the fact that the local market is slowing
down: fewer multiple offers, and more properties languishing on the
market. The inventory is going up nearly
everywhere, and some sellers are more willing to accept a “contingent” offer,
if it is otherwise a good offer.

For this to happen, it is also important to be aware of whether it is easier to sell a home or to buy one in the exact locations you
are considering: the location you leave, and the location you want to buy in. Your Realtor, a local specialist, is
essential to help you with the research.

Thank you for reading - Let me know if I can help you with your real estate plans.

Tuesday, September 13, 2016

First-time home buyers make about a third of all home buyers, nationwide, according
to the National Association of Realtors.

The median age of a
first-time buyer is 31, (making about $70k), while the median age of a repeat
buyer is 53, (making nearly $100k). It is safe to say that they
do not have the same priorities.

While first-time home buyers
usually settled in the past for a cheaper “starter home”, there are signs now
that more want to have a home for the long term, holding back for a home that
will work for them for a much longer time.
70% are willing to wait, rather than settle for that cheaper, smaller
house with some repairs.

Since we have
been faced with a severe scarcity of “starter homes” for sale, compared with a
few years back, the price tag of those properties went up drastically. It is possible that first-time home buyers find
that the price is not worth it any more and prefer to wait for more savings to
buy a larger first home that will serve their needs for many more years.

Per the Residential Specialist (trsmag.com) the main home features that first time home buyers like most are, in order:

- updated kitchen and bathrooms (81%),

- an open floor plan (59%),

- low maintenance characteristics (43%),

- walkable communities (36%),

- energy efficiency (20%),

- cell phone service and wifi access (19%).

Those feature preferences are definitely evident in our market in the Silicon Valley, and with the exception of the last one, I think the order is pretty much the same. Here, phone reception and wifi access is also close to the top of the list in my experience.

Thank you for reading!

Let me know if I can be of assistance to you, or someone you know, with real estate questions.Francis

In it, one can find important stats which can be found here
and there in various real estate articles and publications, - and in some of my
blogs, like:

Inventory (fig. 10, page 10):

-There are 1.9% fewer existing homes for sale in the US
than one year ago,

-7.8% fewer entry-level homes for sale,

-New home sales still at their lowest, for the past 25
years (although the inventory of new homes for sale went up by 8.2% in 2015,
which is a step in the right direction) - see page 9 and 10.

Homeownership:fewer
people own their home in the US:

-Homeownership rate is much lower than before the 2008
crisis, over all at 63.7% (see page 19),

-This is the case in pretty much all of the age groups
(page 2).

-The number of renters has increased by 9 million in
the past 10 years, with vacancy rates falling and rents climbing, as we all
know (especially in the Bay Area). Not so well known: people in their 50s and
60s make up the largest part of the increase in renters.

-The number of renters paying more than 50% of income
for housing jumped by 2.1 million, to a total of 11.4 million. (page 4).

-A growing supply of new housing being built may help
ease these conditions.Something to
follow up on …

Affordability:

-The percentage
of all households that can afford to purchase a median-priced, single-family
home is called the Housing Affordability Index.It is 60% for the US.Compare
this to California: 30%, and the County of Santa Clara: 20%

-The share of adults aged 20-39 with student loan debt
went from 22% in 2001 to 39% in 2013, while the average amount owed went respectively
from $17k to $30k;- this has an impact
on the housing market as a whole: fewer homes sell as a consequence.Since housing makes a good part of the
economy, one could deduce that it is not good for the US.

-Homebuying activity is much lower than before 2007, but
is now on the uptick (pg.21).

Property value appreciation:

-Very uneven, depending on the area.Some areas still lag in appreciation (pg 11).
Some areas are higher than at the peak before the 2007 crisis, and some are
still way below.

-Of course, overall, fewer homeowners are “under water”.

The report, for those interested, is a treasure trove of
fascinating information about our society and the US housing situation.In trying to keep some perspective on the
real estate market locally in the Bay Area, I find it enlightening, and offer the following graph that I keep over the years:

Thursday, July 14, 2016

The number of sales to foreign buyers rose once again over
the past year, although international buyers are shifting their preferences from
luxury homes to less-pricey properties.

NAR (National Association or Realtors) economists think the
change in the price of homes international buyers are after may be due to
overall higher home prices, along with a stronger U.S. dollar, which both cost
foreign buyers more these days.

“Weaker economic growth throughout the world, devalued
foreign currencies and financial market turbulence” all had an impact on
foreign buyers over the past year, said Lawrence Yun, NAR’s chief
economist. “While these obstacles led to a cool down in sales from
nonresident foreign buyers, the purchases by recent immigrant foreigners rose,
resulting in the overall sales dollar volume still being the second highest
since 2009.”

Foreign buyers purchased $102.6 billion of residential
property in the U.S. between April 2015 and March 2016, according to NAR’s
report. The number of properties purchased rose 2.8 percent to 214,885. The value of
homes bought by foreigners was typically higher than the median price of all
U.S. homes.

Experts say a slight drop in dollar volume is due to the
types of properties purchased, and the locations of those properties. There are signs that foreign
buyers have begun looking beyond higher-priced markets like San Francisco and
New York to purchase properties in smaller, less-expensive cities in the
Southeast and Midwest.

Chinese purchasers continued to outpace all others, with
their dollar volume exceeding the total of the next four ranked countries
combined. Their dollar volume of sales, at $27.3 billion, was three times as
much as Canadian buyers, who were ranked second. Chinese buyers also bought the
most expensive homes at a median price of $542,084.

Five states accounted for half of foreign buyer purchases,
according to the NAR report: Florida, (22 percent), California (15 percent),
Texas (10 percent), Arizona and New York (each at 4 percent).

It is interesting to note that California is home to about 25% of all of the foreign-born population of the US. Florida has only 9% of the foreign-born population of the US, as shown on the graph below:

Friday, July 1, 2016

The definition of a Millennial is not straightforward as evidenced by the many resources found online. However, if we follow the general guidelines of the Pew Research Center we can agree that these would be the people between the age of 19 and 35 as of 2016 (i.e. born between 1981 and 1997).
For the 3rd straight year nationwide, millennial homebuyers made up the largest part of all homebuyers: 35%, edging out Gen X (26%), boomers (31%) and the silent generation (9%).

Lots has been said and written about the level of indebtedness found associated with this slice of the American population (see for instance the article by Maya Pope-Chappell that I show on my previous post on my FB page: "buried-in-debt millennials..."). Because they are the largest part of all homebuyers, we can only assume that more people nationwide would be engaged into the process of owning a home if the Millennials were not so saddled with student loans. This could have in turn very positive repercussions on the US economy as a whole.

In California, these are some of the stats for Millennials and Baby Boomers (born between 1946 and 1964):

Thursday, June 16, 2016

Taking the pulse of the local offices, and managers and agents in the local cities. It does not get more "down to earth" and "raw" than that! ;-)

SF Peninsula – Listing inventory is steadily increasing in the Burlingame area, and so are sales, according to our local manager. Across the hill in Half Moon Bay, there has been a continuous increase in inventory. Our local manager provided this update for the area of Half Moon Bay, El Granada, Montara, Moss Beach, and Pescadero market update: The average listing price is $1,428,716, highest listing price is $3,388,888, and the lowest listing price is $699,000. Pending Average listing price is $1,372,445, highest listing price is $1,988,000, and the lowest listing price is $785,000. Sold average listing price is $1,062,552, the sold price is $1,071,980, days on the market is 14 days. ... Our Menlo Park manager said the local market is steady but cautious. No throwing money at houses now like caution to the wind. She adds that sellers are more likely to look at a pre-emptive offer now realizing that we could be close to the ‘top of the market’ if anyone can really see that without it being behind them. Our Redwood City-San Carlos manager reports lots and lots of frustration out there for everyone (sellers, buyers, agents). It’s a definite alteration in the market (which was needed). Only the ideal homes with the ideal location and the ideal price are selling quickly. All the rest are remaining on the market with very little, if any, showings. The San Mateo market has slowed down, our local manager says. Our Woodside-Portola Valley manager says that
Woodside continues to be a good/bad market. It is a month to month thing. Big buyers are out there but always waiting for the RIGHT house. The market is feeling cautious, she notes.

Silicon Valley – Our Cupertino manager says homes are staying on the market longer and need to be priced right. Open houses are spotty. That can be a good thing because agents have more chances to engage visitors in conversation, and perhaps get new clients. She adds that the luxury segment has been slowing. In the Los Gatos area, competition remains heavy for entry-level homes listed under $2,000,000. More inventory is hitting the market in the $2,000,000 plus range. Our San Jose-Almaden manager says we’re starting to see an increase number of active listings as well as a lower number of homes pending in Santa Clara County. The available inventory is actually higher than the number of available in 2014. Not surprising were the lower number of units sold for May. There were 35 properties sold in Almaden for the month which is down 25% from last month and 18% from the previous year. Blossom Valley was slightly better with a total of 101 homes sold for the month which is down 8.5% from the previous year. Cambrian was almost flat, with 78 properties selling for the month which is just down 2.5% for the previous month and year. Santa Teresa had 27 homes sold which is down 16% from the same time last year. Willow Glen had a sleepy Memorial Day week. Sales were slow and not many new listings came to the market. The following week things started moving again we had one of our better sales weeks and listing inventory is back up to 92 units. We are still hovering at 3-4 year highs for active listing inventory. The local market seems to be driven mainly by price point. Anything under or around the $850,000 price point is drawing lots of attention and still attracting multiple offers well over list price.

It is my experience that in Los Altos / Mountain View / Palo Alto the market is a little slower like elsewhere, but still quite active: anything priced right is selling quite well, even if sometimes it is not right away (like the first week). I think the consensus is that prices are going to be flatter unless the property is among the most desirable in its category (and not overpriced).
The least expensive house in Mountain View sold in April for $1,050,000.
The least expensive house in Palo Alto sold in February for $1,325,000 (with a lot of 2,875 sq.ft.).

Thanks for reading, and hoping each finds his/her own area in the above ;-)
Francis

Wednesday, June 1, 2016

The City of Mountain View has earmarked $36 million for affordable housing. (See: "The View of Spring/Summer 2016).

Of these funds, $22.25 million were allocated by the City Council to contribute to a project of a new 116-unit affordable family development located at the corner of East Evelyn Ave and South Bernardo Ave. This project aims to benefit people with incomes at or below 60% area median income (AMI), with a particular focus on those who live or work in Mountain View. This development by ROEM Development Corporation is anticipated to be fully occupied by late Summer 2018.

Another project by Palo Alto Housing Corporation is a 67-studio unit development located at 1701-07 W. El Camino Real. It will provide 30 units of veteran housing with the remaining units available to extremely low-income households earning 30 % AMI or less, and very-low income households with annual incomes at or below 60% AMI. Here the City Council reserved $8 million funding in Oct 2015 and the completion of construction is anticipated for late 2017.

Separately, but in the same vein on the affordable housing subject, the City is updating its companion unit regulations to allow for and encourage additional diverse housing opportunities. What is more commonly known as "granny units", or "in-law units", or "accessory dwelling units" currently need to fit fairly strict guidelines, some of them laid out in this part of the City of Mountain View "City Code" page (Chapter 36 - Zoning).
Will we see loosening of the guidelines soon? Some people like the idea.

Tuesday, May 17, 2016

Mortgage lenders are easing up on credit,
but not much….“Credit is expanding
very, very slightly from absurdly tight levels”said Laurie Goodman, Ph.D., Director of Housing Policy at the Urban
Institute. (see CAR's magazine - Nov/Dec 2015).The Institute’s Housing Credit Availability Index (HCAI) measures the probability of a loan ever going
90 days delinquent.Based on the Index,
the fourth-quarter 2015 default rate was 5.6%.As a comparison, the average default rate for the whole mortgage market in the years 2001 to 2003 was 12.5%, and considered standard.Lenders are taking much less risks nowadays, and it shows in the current process that buyers have to go through right now in order to get their loan. Underwriters have to show that they have been super careful. As loose criteria lead to abuses - as we have seen too well 6-8 years ago, this is a good thing. But current criteria are too tight for some, who would like to see more "willing and able" buyers have access to home ownership. Indeed the renting alternative can be brutal and in some cases more costly, actually.

"Current criteria" also include the lack of bridge loans, which were so prevalent up until the financial crisis. In my opinion, this is one of the main reasons why the market is currently so tight: most people who would like to move up, or down, do not have the means to qualify for both houses, which is what lenders currently demand. Before the crisis, banks would only ask the buyers to qualify for their new purchase, not both the new purchase and the currently owned home. All they wanted to see was some proof that the currently owned home was going to be sold (i.e. a listing agreement with a Realtor). But this is not the case any more.
The reason why bridge loans are not available is a mystery to me: there is no risk at all for the banks in the Bay Area (and many other appreciating areas, see my last blog on underwater properties), to lend money on a move-up or down purchase. The demand for housing is so strong that the previous home will sell very fast. More houses sold means more loans made by the banks, doesn't it?
These new tight lending rules certainly contribute to the lack of inventory, which also make it harder for buyers to make a purchase. I have several clients would have moved by now if real bridge loans were available.

As is often the case, the pendulum swung too far the other way in my opinion.

From the trenches, dealing with the market on a daily basis, I think many agents would agree that the activity shows signs of leveling a bit - but we have to characterize this with a few caveats: buyers still need to be completely pre-approved, and very motivated. It's just that where we could expect 10 offers, it seems that we are seeing, say, half that amount lately. Several factors are in play here, influencing activity:

- overpriced listings will stay on the market for a while, (& there are a few more lately),
- the increase in price is not as high as it has been until now,
- the best properties (most desirable) will always be the ones with the most activity,
- more homes are coming now on the market, and this is normal for the time of the year,
- inventory is -still- not a lot higher in PA, Los Altos and Menlo Park,
- and finally, some buyers have been priced out of the market (hence, a bit less competition).

Whether you are a buyer or a seller, I think a real estate professional has never been so important in helping you see more clearly, and separate the hype from the facts.

Tuesday, March 15, 2016

One million borrowers regained equity in 2015, bringing the
total number of mortgaged residential properties with equity at the end of the
4th quarter of 2015 to approximately 46.3 million, or 91.5 % of all
mortgaged properties, according to a new CoreLogic® analysis. Nationwide, borrower equity increased
year-over-year by $682 billion in Q4 2015.

The total number of mortgaged residential properties with
negative equity (“under water”) decreased 19.1 % year over year from what it
was at the end of last year.

Interestingly, Miami-Miami Beach-Kendall, Florida, had the
highest percentage of mortgaged properties in negative equity (22% of the
total).

San Francisco-Redwood City-South San Francisco, CA, had the
highest percentage of mortgaged properties in a positive equity position, at
99.3%. Houston, then Denver followed
SF in that category.

Thursday, March 10, 2016

Didn't you ever wish you could try out your
neighborhood - before buying your home there?

What a novel idea!:

Realtor.com’s new partnership with Airbnb, which launched in
June 2015, aims to allow just that.

A buyer thinking about buying in a specific neighborhood can
“try out” the area by renting a place for a few days through Airbnb.

Such recommended accommodation can be found
on realtor.com in the same area as the home listing they are viewing.“Real estate professionals are finding that
buyers are more likely to be happier if they are able to try out a neighborhood
before choosing to buy” says a Realtor.com spokesperson.

Checking out noise levels, culture, overall
vibes gives prospective condo and single-family home owners important
information as they make their decision.

Sunday, February 21, 2016

The share of first-time home buyers declined for the 3rd consecutive year and remained at its lowest point in nearly three decades, according to the NAR (National Association of Realtors®). The overall strong pace of home sales in 2015 was driven more by repeat buyers with dual incomes, according to NAR's annual survey.In the past 5 years, this is the share of new buyers among all the buyers of real estate:

To continue on with this survey, this is how buyers responded overall to the question: Why buy now?

"Homes affordable" was not popular... ;-)It is refreshing to see "Right time" come up so much in the results - isn't it the best reason to buy?Thanks for reading!Francis

Saturday, January 23, 2016

Our latest "report from the trenches", from the Coldwell Banker office managers all along the Peninsula:

SF Peninsula – ... In her decades of experience in this area, our Menlo Park manager has never seen the market so low on inventory – even for this time of year. Buyers are out in droves yet after last week in the equity markets, they are a bit in a wait and see attitude. Properties are still moving quickly but there are more buyers than actual ‘bidders’ right now, she says. Anything under $1.4 million is getting a lot of attention and selling quickly. $5-6 million homes are becoming more and more common in Menlo Park. Inventory is seasonally low in Palo Alto, but demand is still there. Amazingly there is still an incredible lack of inventory all over the Peninsula, says our Redwood City manager. Because of this almost all offers are multiple offers. There still are a lot of buyers with sufficient funds to purchase but due to the lack of inventory there is a tremendous amount of frustration. More inventory is hitting the San Mateo area market, our local manager says. Agents have a number of listings inked and ready to come on in the next couple of weeks. The market is “moribund” right now in the country offices, reports our Portola Valley-Woodside manager. But she says that this area always seems slow to start the new year.Silicon Valley – New inventory is slow to hit the Cupertino area market. The few new open houses our local agents held had 200-300 visitors in some cases. There are currently 25 homes for sale in Los Gatos, down 40% from the same time last year, reports our Los Gatos manager. The San Jose Almaden market has been more of the same with lower inventory than previous years, although it has increased since December. Buyers aren’t waiting to write up offers. Most of the listings are going into contract during the first weekend of open houses. A 1,330 square foot SFR in Santa Clara (with Cupertino HS) that had a list price of $895,000 received 46 offers and sold for $1,330,000. With the New Year underway the post-holiday local Willow Glen market is busy although it is still experiencing extremely low listing inventory. The year started with only 23 active listings and dropped to 21 in week two. Open houses are jammed, and multiple offers well over list price are the norm. Agents all have a bounty of buyers they are trying to get into something.

My personal experience has been a difficult market for buyers, even towards the end of the year, when buyers typically are given a break. The transactions I have had in the past two months have been tough, and buyers could not ask for much...
Such is the market!